What is C-PACE?
Many property owners in Montana face high utility bills caused by old, inefficient buildings in need of upgrades. Although energy improvements would save Montana business owners more money on their utility bills than they cost over the long run, the upfront costs can be hard to afford.
Commercial Property Assessed Clean Energy (C-PACE) is a solution to these financial challenges. C-PACE is a financing tool that allows property owners to secure 100% upfront financing for energy efficiency, water conservation, and renewable energy upgrades to commercial buildings. The cost of these upgrades is repaid as a small assessment on the property's annual tax bill. Like a Special Improvement District for sidewalks or sewers, the financing is repaid as an assessment on the property’s regular tax bill over a term of up to 20 years. The annual energy savings for C-PACE projects are designed to exceed the annual assessment payment, so property owners save money from the start.
This tried-and-true tool is enabled in 36 states and counting. To enable C-PACE in Montana, we must first pass legislation that enables it. In other words, this legislation gives the "green light" to counties across the state to start allowing people to take advantage of the program. Once the program is enabled, it is voluntary for both counties and individuals. Click here to learn how you can help bring C-PACE to Montana.
| Commercial Property Assessed Clean Energy |
Saving Montanans money, creating local jobs, conserving energy
C-PACE is 100% voluntary. Once C-PACE-enabling legislation is passed in Montana, counties can choose whether to participate. In communities that opt into C-PACE, assessments are only paid by participating building owners, and only for their own projects.
C-PACE property assessments are a lien on the property. Upon sale of commercial properties, the C-PACE assessment transfers to the new owner, because it represents investment in the property, not the person. The new owner will reap the benefits of energy cost savings, just like the owner before.
C-PACE projects are funded with private capital. C-PACE assessments can attract a wide range of private market investors with low interest rates because special assessments place a lien against the property, making them stable, low risk investments.
Growing Montana's Economy
Contractors, engineers, and labor
When building owners can easily finance the up-front cost of an energy efficiency project, more projects are completed, creating more work for HVAC, lighting, insulation, and electric contractors, engineers, and suppliers.
Local governments and economic development agencies support C-PACE because it’s an economic development strategy that lowers the cost of doing business in their community and enables a new financing tool for renovating existing buildings and new projects. It encourages new business owners to invest in Main Street Montana, and creates jobs using the local workforce.
C-PACE benefits property owners because they can fund projects with no out-of-pocket costs. Since C-PACE financing terms extend up to 20 years, it’s possible to undertake deep, comprehensive retrofits that have meaningful energy savings and a significant impact on the bottom line. The annual energy savings for a C-PACE project are designed to exceed the annual assessment payment, so property owners are cash flow positive immediately. That means there are increased dollars that can be spent on other capital projects, budgetary expenses, employee retention, or business expansion.
Banks and private capital providers
C-PACE projects are funded with private capital. C-PACE assessments attract a wide range of private market investors with low interest rates because special assessments place a lien against the property, making them stable, low risk investments. Existing mortgage lenders will support projects that meet their clients’ objectives and increase the value of their collateral, the property. C-PACE only moves forward with mortgage lender consent.
Agricultural properties such as farms and ranches are eligible for the same upgrades as any other CPACE-eligible property, including: water conservation upgrades to irrigation systems or pumps, energy upgrades to buildings, and on-site renewable energy generation like solar or wind.
Clean energy businesses
C-PACE can provide the up-front financing for on-site renewable energy generation like solar and wind. This will allow Montana's many renewable energy businesses-- and the other contractors they employ-- to grow and thrive.
Other energy service companies like energy auditors have an important role in C-PACE. Energy audits will be required to "benchmark" the energy usage of a building and determine what improvement measures will be effective.